During World War 1, federal spending tripled three times as much as tax collections. When the government cut back on spending to balance the budget in 1920, after that a monstrous recession happened. The war economy invested heavily in the manafucturing sector and, the next decade saw an explosion of productivity.
An average of 600 banks were falling year.
Labor declined throughout the decade. The United Mine Workers Union saw a downfall in membership; it went from 500,000 in 1920, to 75,000 in 1928.
Over the decade, about 1200 mergers swallowed more than 6000 individual companies. By 1929, 200 corporations controlled more than half of America's industry.
As the end of the decade was approaching, the bottom 80% income-earners were removed from the tax rolls completely. Taxes on the wealthy also, fell throughout the decade.
By 1929, the richest 1% owned 40% of the nation's wealth. The bottom 93% experienced a 4% drop in per-capita income between 1923-1929.
The conserative Supreme Court outlawed federal child labor laws.
In 1923, president Warren Harding died in office. Due to his death Coolidge became president.
Stock markets began to rise, which beared little relation to the rest of the economy.
The top tax rate lowered 25% in 1925. The lowest rate in eight decades following World War I.
Between May 1928 and September 1929, average stocks rose 40%. The bloom was mainly artificial.
In 1929 Herbert Hover took office for the president of the United States.
The annual per-capita income was $750. More than half of all Americans were living below the minimum subsitence level.
Backlog of bussiness' inventories grew three times larger than the previous year.
The recession began in August of 1929, two months before the stock market crashed. During that two month period production declined an annual 20%, wholesale prices were at 7.5%, and personal was at 5%.
1930's
By Februaury, the Federal Reserve cut the prime interest rate from 6 to 4 percent. Treasury Secretary Andrew Mellon announced; the Fed will stand by as the market worked itself out.
The Supreme Court ruled that tyhe monoply U.S Steel didn't violate anti-trust laws, as long as competition existed.
The GNP fell 9.4% from the previous year. The unemployment rate climbed from 3.2 to 8.7 percent.
No major legislation is passed addressing the Depression.
The GNP fell another 8.5 percent; unemployment rose to 15.9 percent.
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1930's